With GDP of US$932.1 billion (2008) and economy rank 15, Indonesia is a founding member of ASEAN and a member of the G-20 major economies. In GDP by sector, Industry accounted major share of 48.1%. The goods exported by the country include oil and gas, electrical appliances, plywood, rubber, and textiles. Indonesian textile industry, as is the case in many developing countries, has already a long standing tradition and is among the pioneering sector in industrial manufacturing. It consists of a number of sub-sectors like weaving, knitting, finishing, batik printing, spinning and man-made fibre production. Usually the industry started with the production of consumer end products like textile fabrics and knitted goods, and also garments and household textile products. Ministry of Industry- The Republic of Indonesia, is the policy maker government body in the welfare of textiles, and other industries at Indonesia. Mr Arryanto Sagala, a graduate in Planology, is the Director of Textiles, The Ministry of Industry - The Republic of Indonesia. Mr Sagala has accomplished several training courses viz. Industrial Estate Development; Industrial Expansion Program from EEC-IDA Ireland; Environment Protection & Technology from ICETT-AOTS Japan; Smelting Industry Processing from Naoshima, Mitsubishi - Japan; Planning, Development & Management of Industrial Park & EPZ-Taipei ICDF & SinoTech Engineering ROC. He attended Comparative Study for Textiles Development at Beijing as well as Technical Upgrading Fund Scheme of India in the year 2006, and had also been in the International Seminar for Textile Development in China. In 1982, he joined Ministry of Industry as the Head of Industrial Estate Development Section of Bureau of Planning. For the span 1994 to 2005, he headed Regional Development & Environment Division of R&D Center on Resources- Industrial Zone and Environment at Ministry. In 2005, he was appointed as the Director of Textiles. His responsibilities include giving advice and making regulation concepts in the welfare of Textiles Industry. In his second appearance on Face2Face, Mr Arryanto Sagala speaks with our Sr Editor & Correspondent- Ms Madhu Soni, about to date Indonesian Textile industry; its strength as well as areas of improvement.
Face2Face is glad to get opportunity of one more talk with you, Mr Sagala! Textile industry has always been pivotal sector for economy of Indonesia. How is its performance nowadays?
The current performance of Indonesia Textile Industry, in brief, can be depicted as following:
The export has increased steadily, amounted to 18.5% on the average for the period of 1984 to 2000. However, affected by the global change, for the last 5 years it tends to slow down. In 2005 Indonesian export for textiles & garments reached USD 8.6 billion, and until 2009 showed USD 9.26 in exports, an increase of 2.09% annually. Though the figure may seem not so impressing, but one thing marking the achievement so far is the ability to keep the trade balance of textile & garment to be positive, i.e. the export surplus always hovering over than USD 5 billion.
Some factors can be mentioned to be responsible for the slowdown of export performance; the emerging of new competing countries such as Vietnam and Bangladesh, the downturn of global economy reaching the peak in 2009, all these pushed the export to decrease inasmuch as 8.70 % than that of in the previous year. In addition, the enactment of AC-FTA in 2010 will bring new challenge for our textile industry.
So, which strengths can help this industry to fetch the growth?
The current strengths of Indonesian textile industry including the following aspects:
1. Textile industry has long been developed, and currently encompassing from the initial up stream industry (man made fiber either polyester or viscose rayon) to the most downstream industry such as garment and other textile goods;
2. Though Indonesia lack cotton as main raw material for spinning, still the Indonesian spinners is noted world wide. With around 8 million spindles, Indonesia is able to export high counts-high quality yarns, whilst catering domestic need as well
3. Products quality is noted world wide.
4. As market, the populous country is providing huge market for textiles, and some measures are being taken to ensure that the whole potential market will be supplied firstly by local producers.
And, areas of improvements that your Ministry is currently working on?
In order to maintain and improve our current performance, presently, our Ministry is working on the following issues:
1. To alleviate problem in obsolete textile machinery, the Government is encouraging industry to take action in modernization and replacement of machines & equipments by providing government assistance through Textile Restructuring Program.
2. We are also consistently encouraging the industry to carry out energy conservation and other measures to ensure the industry consuming energy thriftily.
3. We are developing technology by enhancing co-operation with developed country such as Japan for instance, by adopting eco-friendly technology in dyeing process.
4. Development of human resources through higher education in textile technology.
5. Intensifying inter-linkage among the industry, from fiber to textile goods and other sectors of economy, by adopting cluster approach in developing textile industry.
Is handicrafts and cottage industry also included in the agenda?
Handicrafts and cottage industries are among other area of development for textile & textiles goods. We encourage the industry to develop local indigenous proprietary, local wisdom such as production system not in-house but spreading in small industry villages, adopting OVOP principle (one village one product), et cetera.
DISCLAIMER: All views and opinions expressed in this column are solely of the interviewee, and they do not reflect in any way the opinion of Fibre2Fashion.com.